Nebraska lawmakers advance bill offering private school scholarship tax credits

LINCOLN — A bill that would offer tax credits for donations to scholarship funds for private and faith-based schools has now made it further than all previous attempts in the Nebraska Legislature, gathering enough votes to pass the first round of debate Wednesday.

Legislative Bill 753 is the latest in a string of similar bills introduced by State Sen. Lou Ann Linehan of the Omaha area intended to provide more school choice opportunities. The bill overcame a three-day filibuster Wednesday before advancing in a 31-12 vote.

As introduced, LB 753 would make $25 million available for credits in 2024, with annual increases in the program of up to 25% possible in future years. A committee amendment that also was approved Wednesday would keep the program at $25 million for two years, then allow it to grow to a maximum of $100 million a year.

The amendment also would cap credits at $100,000 annually for individuals and businesses and at $1 million for estates and trusts.

The Nebraska Legislature has considered similar measures in each of the last five years, but all have failed. Last year’s proposal fell five votes short on a filibuster-ending cloture motion.

This time around, LB 753 narrowly overcame the first-round filibuster, reaching cloture through a 33-12 vote.

“I’m thrilled we got cloture,” Linehan said. “I’m disappointed we didn’t get everybody.”

Support from multiple Democrats, including Omaha Sens. Terrell McKinney, Justin Wayne and Mike McDonnell, proved to be the difference-maker this year. McKinney and Wayne repeatedly spoke out in support of LB 753, saying it would provide families in their district more options for better education.

“These families are tired of being told to wait,” McKinney said.

At the same time, a handful of Republican lawmakers held off pledging their support for the bill, with Sens. Tom Brandt of Plymouth, Myron Dorn of Adams and Jana Hughes of Seward being present not voting on the underlying bill. On Tuesday, Brandt expressed reservations with LB 753, reading statements from an op-ed published by former lawmaker Curt Friesen that doubted the bill’s benefits to rural students and taxpayers.

Hughes said she supports the overall intent of LB 753 but has some concerns. She declined to elaborate and said she is working with Linehan to address them. Linehan said she hopes to have 45 out of the Legislature’s 49 lawmakers supporting the bill by the time it reaches its final votes.

“We’ll get to something that everyone can support,” Linehan said.

One new amendment Linehan said she already plans to bring would clarify that the bill would support students across all of Nebraska, based on concerns that it would benefit only Omaha-area students.

LB 753 is part of a larger education package proposed by Gov. Jim Pillen that would, among other things, provide an additional $1 billion to public education funding through a new component of the state’s general fund. Linehan said she believed once the other education funding proposals are ironed out, her bill will gain support from lawmakers who were concerned that it would take away funding from underserved public schools.

Some opponents also argued LB 753 would benefit schools that discriminate against students and would amount to a tax credit for the wealthy. The Institute of Taxation and Economic Policy (ITEP), a national nonprofit, released a statement against the bill Tuesday. It said in states that have passed similar measures, the bulk of the credits are being claimed by wealthy families.

“These tax credits are among the most significant tools eroding the public education system and propping up private schools,” the statement read.

Meanwhile, supporters contend that LB 753 is essential to provide low-income students the means to access better education. They argue that many public schools are lower quality than private schools, which opponents disputed.

“This is the way we get kids out of poverty,” said Sen. Christy Armendariz of Omaha.